Hyperliquid Revolutionizes DeFi with Composable Liquidity

The concept that liquidity attracts liquidity holds true, and Hyperliquid has emerged as a top choice for traders seeking to engage with perpetual futures, also known as 'perps'. Founded by Harvard alumni Jeff Yan and a pseudonymous developer known as iliensinc, Hyperliquid launched in early 2023 and has been capitalizing on the depth and volume of its order book. The platform offers a unique feature known as composability, allowing permissionless smart contracts to interlock seamlessly, much like financial building blocks. Hyperliquid's Ethereum-compatible HyperEVM is directly connected to its high-performance HyperCore blockchain. This setup enables other applications to utilize the platform's shared liquidity, rather than fragmenting it. As a result, applications such as wallets or exchanges can integrate Hyperliquid as a backend, providing perps trading and other services. As more developers integrate with Hyperliquid, the platform's liquidity deepens, and the variety of assets expands. Currently, hundreds of developers, including prominent names like MetaMask and Phantom wallet, are utilizing Hyperliquid's 'builder codes', generating approximately $90 million in revenue. The platform has garnered significant praise from its users, with Hyunsu Jung, CEO of Hyperion DeFi, describing Hyperliquid as 'the AWS for finance'. Jung highlights that the platform's true value lies in its layer-one blockchain infrastructure, providing liquidity and execution services. Similar to AWS, builders maintain full control over their users and interface, while Hyperliquid provides the underlying liquidity and execution. The 'builder codes' allow integrators to focus on delivering a seamless user experience, while Hyperliquid handles the backend operations. For instance, MetaMask, a popular Ethereum-based wallet, has integrated Hyperliquid's EVM module, enabling users to access perps directly from their wallets. This integration has streamlined the trading process, allowing users to trade with the tokens they already hold. According to Matthieu Saint Olive, Staff Product Manager at MetaMask, the integration with Hyperliquid has been successful, with the platform handling matching, oracle, and margin engine operations. MetaMask has seen growth in perps trading, with real-world asset markets accounting for a significant portion of the volume. In terms of fees, MetaMask charges a flat 0.1% builder fee, with no hidden spreads or execution costs. The platform is exploring innovative pricing models to ensure transparency and fairness. Even large centralized exchanges, such as South Africa-based VALR, have opted to utilize Hyperliquid's perps order book. Despite initially building their own infrastructure, the exchange found it challenging to achieve sufficient volume and liquidity. Looking ahead, the increasing adoption of perps by major exchanges is expected to create opportunities for cross-venue arbitrage, according to Jung. As the market continues to evolve, Hyperliquid is well-positioned to play a key role in shaping the future of decentralized finance.